Generac Holdings (GNRC)

May 19, 2022Trade Ideas

With hurricane season nearing, investors may want to use Generac Holdings’ (GNRC) weakness as an opportunity. Currently trading at $209.81, the generator stock is oversold.

As we get closer to hurricane season, GNRC could rally, as demand for generators heats up. Helping, the 2022 hurricane season may be more active than usual, according to scientists at Colorado State University, as noted by NPR.

Also, the company recently posted better than expected earnings and raised its 2022 sales outlook. For Q1, 2022, the company posted adjusted EPS of $2.09, which topped estimates for $1.92. Revenue came in at $1.14 billion, which also beat expectations for $1.09 billion.

According to Barron’s, “The company also increased its full-year 2022 sales outlook, “as a result of better-than-expected production output in the first quarter and additional price actions being taken in the second quarter.” Generac now expects sales to increase between 36% and 40%, which is more than the previous guidance of 32% to 36%.”

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